Note 5 - Income Taxes

12 Months Ended

Nov. 30, 2023

Notes to Financial Statements

Income Tax Disclosure [Text Block]

Note 5 – Income Taxes

The components of the Company’s provision for income taxes are as follows:

	2023		2022
Current
Federal	$	116,715	$	36,501
State		38,692		22,100
Deferred		27,593		117,586
Total	$	183,000	$	176,187

In fiscal 2023 and 2022 the federal and state effective tax rates were within the customary statutory tax rate of federal 21% and a state rate of 7.11%.

A reconciliation of the expected income tax expense to the recorded income tax expense is as follows for the years ended November 30:

	2023			2022
Federal income tax provision computed at federal statutory rate	$	136,857		$	128,012
State income taxes, net of federal tax provision		46,336			43,341
Change in valuation allowance and other adjustments		(193	)		4,834
Tax Provision	$	183,000		$	176,187

The components of the Company’s deferred tax assets and liabilities for federal and state income taxes consist of the following:

	2023			2022
Deferred revenue	$	54,005		$	44,682
Marketing Fund net contributions		50,094			78,541
Allowance for doubtful accounts and notes receivable		8,116			3,056
Accrued expenses		55,070			60,868
Operating lease liability		11,193			43,206
Net operating loss carryforwards		-			-
Total Deferred Income Tax Asset	$	178,478		$	230,353
Depreciation and amortization	$	(478,566	)	$	(476,180	)
Right of use lease asset		(9,205	)		(35,873	)
Total Deferred Income Tax Liabilities	$	(487,771	)	$	(512,053	)
Total Net Deferred Tax Liability	$	(309,293	)	$	(281,700	)

As of November 30, 2023 and 2022 the Company had no unused net operating loss carryforwards.

The Company routinely reviews the future realization of tax assets based on projected future reversals of taxable temporary differences, available tax planning strategies and projected future taxable income.

The Company’s income tax returns, which are filed as a consolidated return for the years ending November 30, 2020, 2021 and 2022 are subject to examination by the IRS and corresponding states, generally for three years after they are filed.